Slide 1: 2014 full year results
2014 full year results 11 March 2015
Slide 2: 2014 results and 2015 outlook
2014 results and 2015 outlook EBITDA1 Highlights 2014 EBITDA and underlying net income €8.0- €7.0- 8.6bn €8.3bn 7.6bn within outlook range Dividend2 of 0.50 €/share, in line with fixed dividend for 2014 and 2015 2014 2014 2015 Outlook Actual Outlook Continuation of scrip dividend scheme Cash
Slide 3: A clear roadmap for 2015 into our future
A clear roadmap for 2015 into our future 1 Preparing the spin-off 2 Sustaining performance culture 3 Disciplined investing in growth areas 4 Delivering on strategy of businesses 2
Slide 4: Preparing the spin off: announced strategy
1 Preparing the spin off: announced strategy E.ON to spin off a majority stake in its power & gas up- and midstream businesses (‘New Company’) to its shareholders Intention to divest remaining stake in the new company over New the medium term post spin-off Company Spin-off expected to be compl
Slide 5: Preparing the Spin off: key milestones
1 Preparing the Spin off: key milestones Q2 2015 Governance & 1 Jan 2016 Steering of both companies Both companies May 2016 defined legally and operationally AGM invitation 8 Jun 2016 Organizational independent set-up and Detailed financial segmentation Carve-out & legal docu- AGM decision H2
Slide 6: Sustaining performance culture
2 Sustaining performance culture Net cost savings E.ON 2.0 targets already achieved in 2014 €0.1-0.2bn Targeted ~€1.3bn of net cost savings already Other cost achieved by 2014 €0.4bn savings ~10.800 FTE reduction achieved by end 2014 €0.7bn E.ON 2.0 Cost savings in 2015 and beyond Net cost sav
Slide 7: Disciplined investing in growth areas
3 Disciplined investing in growth areas Capex 2012-20151 2014 capex of €4.6bn, ~8% €bn 8 lower than initially planned 2015 capex planned at ~€4.3bn, 6 including additional capex announced in December 4 2015 capex in Wind & Solar, Distribution Networks and 2 Customers Solutions ~€3.1bn, up ~€0.
Slide 8: Generation: capacity markets gaining momentum
4 Generation: capacity markets gaining momentum Hedging & achieved prices Regulatory developments Hedging Central Europe Capacity markets 60 €/MWh EU Commission to develop reference model E.ON for Capacity Remuneration Mechanisms 45 achieved /hedged UK 30 prices Auction for 2018-19 capacity in
Slide 9: Renewables: offshore wind projects on track
4 Renewables: offshore wind projects on track Amrumbank West 288 MW ~€1bn capex Kårehamn Start in Autumn 2015 Amrumbank Humber West Arkona Gateway Alpha Robin ventus Humber Gateway Rödsand 2 Rigg Scroby 219 MW Sands London ~€1bn capex Array In operation Start in Rampion Under constructio
Slide 10: Distribution: strong foundations for steady growth
4 Distribution: strong foundations for steady growth Regulatory asset base Current regulatory discussion Germany Distribution capex vs. €bn Network regulator BNetzA published regulatory depreciation major report “Incentive Regulation 2.0” 1,5 Example of attractive reform proposal: carry-over mec
Slide 11: Customer Solutions: empowering customers
4 Customer Solutions: empowering customers Evolution of customer numbers (in million) Customer numbers: Focus on margins rather than volumes 8,2 8,0 7,7 UK First rise of customer numbers in Germany for 6,3 6,2 6,3 Germany many years European base expected to be stable, strong 9,4 9,4 9,4 Other
Slide 12: Executive summary
Executive summary Executing new strategy and spin-off: now getting into the details Growing resilience in a still tough environment Staying focused on running and improving our businesses Visual One2Two project 11
Slide 13: 2014 full year results – CFO part
2014 full year results – CFO part
Slide 14: Full year 2014 EBITDA development
Full year 2014 EBITDA development 1,2,3 €bn FY 2013 9.2 E&P 0.1 E.ON 2.0 0.4 Renewables (EC&R) 0.1 Nuclear fuel tax 0.2 Disposals -0.6 FX effects -0.2 German regulation -0.3 Region Czechia -0.2 Power price and volume effect -0.2 Gas optimization -0.1 Other -0.1 FY 2014 8.3 1. Adjusted for extraordin
Slide 15: Full year 2014 underlying net income
Full year 2014 underlying net income2 €m 2013 1,3 2014 3 % YoY EBITDA 2 9,191 8,337 -9 Depreciation/amortization recognized in EBIT 2 -3,567 -3,673 - EBIT 2 5,624 4,664 -17 Economic interest expense (net) -1,874 -1,612 - EBT 2 3,750 3,052 -19 Income taxes on EBT 2 -1,201 -1,090 - % of EBT 2 32 36 -
Slide 16: Full year 2014 EBITDA – OCF Reconciliation
Full year 2014 EBITDA1 – OCF Reconciliation €bn EBITDA 1 8.3 Non-cash effective EBITDA items +2.6 Cash-effective EBITDA 10.9 Provision utilization -2.5 Working capital +0.1 movements Tax, interest & other -2.2 OCF 2 after interest and tax 6.3 1. Adjusted for extraordinary effects 2. OCF from continu
Slide 17: Full year 2014 cash balance
Full year 2014 cash balance €bn 2014 operating cash flow 6.3 Cash effective investments -4.6 Dividends (post scrip) -0.8 Free cash flow 0.9 Dividends to non-controlling interests -0.2 Build & sell proceeds +0.8 Cash balance 1.5 Adjustment 2014 nuclear tax -0.4 Adjusted cash balance 1.1 16 1. Adjuste
Slide 18: Full year 2014 economic net debt development
Full year 2014 economic net debt development €bn December 31, 2013 -21.7 -10.5 -32.2 1 Dividends -1.0 Investments -4.6 Net financial position Provisions and other Other -2.5 Pension obligations -2.2 Divestments +2.8 Operating cash flow 2 +6.3 December 31, 2014 -24.6 -8.8 -33.4 1. Figures as of 31.12
Slide 19: 2015 outlook
2015 outlook EBITDA1,2 €bn FY 2014 EBITDA 8.3 Net cost savings Capacity growth Organic improvement regions Power portfolio E&P Disposals FX Other FY 2015 EBITDA 7.0 – 7.6 1. Adjusted for extraordinary effects 18 2. 2014 EBITDA reflecting the treatment as discontinued operations of the Regional Units
Slide 20: 2015 outlook
2015 outlook €bn 2014A 1, 3 2015E EBITDA 2 8.3 7.0 – 7.6 Depreciation 3.7 Economic interest expense 1.6 Taxes 1.1 Non-controlling interests 0.4 Underlying net income 2 1.6 1.4 – 1.8 1. Including pro forma adjustment regarding IFRS 10/11 2. Adjusted for extraordinary effects 19 3. With Region
Slide 21: Backup
Backup 20
Slide 22: 2015 EBITDA outlook per unit
2015 EBITDA1 outlook per unit €bn 2014A 2015E Main drivers Germany 1.8 Organic improvements and weather normalization Organic improvements and weather normalization Other EU Countries 1.7 vs. impact of FX and storm cost Hydro: Lower hydro prices, lower volumes (due to Renewables 1.5 disposals)
Slide 23: Full year 2014 financial highlights
Full year 2014 financial highlights €m 2013 1 2014 % YoY Sales 119,688 111,556 -7 EBITDA 2 9,191 8,337 -9 EBIT 2 5,624 4,664 -17 Underlying net income 2 2,126 1,612 -24 Operating cash flow 4 6,260 6,253 - Investments 7,992 4,633 -42 Economic net debt -32,218 -33,394 -1,176 3 1. Including pro forma a
Slide 24: Full year 2014 EBITDA and EBIT by unit
Full year 2014 EBITDA and EBIT by unit €m EBITDA 1 EBIT 1 2013 2 2014 % YoY 2013 2 2014 % YoY Generation 1,936 2,215 +14 1,017 1,201 +18 Renewables 1,464 1,500 +2 1,014 1,044 +3 Global Commodities 311 21 -93 192 -75 - Exploration & Production 1,070 1,136 +6 560 498 -11 Germany 2,387 1,846 -23 1,667
Slide 25: From EBITDA to net income
From EBITDA to net income 2013 2 2014 % YoY EBITDA 1 9,191 8,337 -9 Depreciation/Amortization/Impairments -3,567 -3,673 - EBIT 1 5,624 4,664 -17 Economic interest expense (net) -1,874 -1,612 - Net book gains 2,004 589 - Restructuring -550 -496 - Mark-to-market valuation of derivatives 765 540 - Impa
Slide 26: Generation
Generation €m EBITDA 1 EBIT 1 2013 2 2014 % YoY 2013 2 2014 % YoY Nuclear 1,240 1,411 14 967 1,085 12 Steam 538 614 14 179 197 10 CCGT 170 200 18 -114 -68 - Other/Consolidation -13 -10 - -15 -13 - Total 1,936 2,215 14 1,017 1,201 18 Main EBITDA effects (in €bn) Nuclear (+0.2) Lower nuclear fuel ta
Slide 27: Renewables
Renewables €m EBITDA 1 EBIT 1 2013 2 2014 % YoY 2013 2 2014 % YoY Hydro 780 677 -13 657 551 -16 Wind/Solar/Other 684 823 +20 357 493 +38 Total 1,464 1,500 +2 1,014 1,044 +3 Main EBITDA effects (in €bn) Hydro (-0.1) Reduced volumes in Germany and Italy due to lower water inflow and last year’s disp
Slide 28: Global Commodities
Global Commodities €m EBITDA 1 EBIT 1 2013 2 2014 % YoY 2013 2 2014 % YoY Coal/Oil/Freight/LNG 48 29 -40 48 29 -40 Power and Gas 176 -145 - 77 -236 - Infrastructure/Other 87 137 +57 67 132 +97 Total 311 21 -93 192 -75 - Main EBITDA effects (in €bn) Power and Gas (-0.3) Prior year’s disposal of Föl
Slide 29: Exploration & Production
Exploration & Production €m EBITDA 1 EBIT 1 2013 2014 % YoY 2013 2014 % YoY Total 1,070 1,136 +6 560 498 -11 Main EBITDA effects (in €bn) North Sea fields (+0.2) Higher volumes mainly driven by Skarv moving to plateau production (+0.4) Lower oil and gas prices in the fourth quarter (-0.1) Curr
Slide 30: Germany
Germany €m EBITDA 1 EBIT 1 2013 2 2014 % YoY 2013 2 2014 % YoY Distribution 1,985 1,525 -23 1,343 953 -29 Non-regulated/Other 402 321 -20 324 231 -29 Total 2,387 1,846 -23 1,667 1,184 -29 Main EBITDA effects (in €bn) Distribution Networks (-0.5) Prior year’s disposal of three regional utilities (-
Slide 31: Other EU Countries
Other EU Countries €m EBITDA 1,3 EBIT 1,3 2013 2 2014 % YoY 2013 2 2014 % YoY Distribution 1,211 1,002 -17 853 641 -25 Sales 484 514 6 392 435 11 Other/Consolidation 317 216 -32 191 55 -71 Total 2,012 1,732 -14 1,436 1,131 -21 Main EBITDA effects (in €bn) Distribution Networks (-0.2) Mainly due to
Slide 32: Non-EU Countries
Non-EU Countries €m EBITDA 1 EBIT 1 2013 2014 % YoY 2013 2014 % YoY Russia 687 517 -25 492 371 -25 (in Mio Ruble) (29,021) (26,361) (-9) (20,756) (18,936) (-9) Other Non-EU -154 -78 - -154 -78 - countries Total 533 439 -18 338 293 -13 Main EBITDA effects (in €bn) Russia (-0.2) Currency translation
Slide 33: Cash effective investments by unit
Cash effective investments by unit €m 20131 2014 % YoY Generation 1,067 862 -19 Renewables 861 1,222 +42 Global Commodities 151 115 -24 Exploration & Production 404 64 -84 Germany 1,013 745 -26 Other EU Countries 2 969 879 -9 Non-EU Countries 3,530 703 -80 Group Management / Consolidation -3 43 - In
Slide 34: Economic net debt
Economic net debt €m 31 Dec 20133 31 Dec 2014 Liquid funds 7,814 6,067 Non-current securities 4,444 4,781 Financial liabilities -22,724 -19,667 Adjustment FX hedging 1 -46 34 Net financial position -10,512 -8,785 Provisions for pensions -3,418 -5,574 Asset retirement obligations 2 -18,288 -19,035 Ec
Slide 35: Strong liquidity and well-balanced maturity profile
Strong liquidity and well-balanced maturity profile Liquidity and financial flexibility Maturity Profile Revolving €bn, as of 31 Dec 2014 1 credit facility (undrawn) 4 €5bn Liquid funds 3 & non-current securities €2.7bn €10.8bn €1.4bn €1.2bn 2 Liquidity 2015 2016 2017 1 Bond & promissory notes matur
Slide 36: Economic interest expense (net)
Economic interest expense (net) YTD YTD Difference €m 2013 3 2014 (in €m) Interest from financial assets/liabilities -948 -817 +131 Interest cost from provisions for pensions and similar provisions -150 -92 +58 Accretion of provisions for retirement obligation and other provisions -915 -1,039 -124 C
Slide 37: E&P - Oil & Gas production
E&P - Oil & Gas production m boe 2013 2014 % YoY Skarv 10.0 13.5 +36 Njord/Hyme 2.4 2.8 +18 Elgin-Franklin 0.6 0.9 +60 Babbage 0.8 1.4 +75 Huntington 0.8 1.2 +52 Rita 0.3 0.7 +196 Total North Sea 16.5 22.4 +40 Yuzhno Russkoje 37.4 37.3 0 Total 52.2 60.0 +11 36
Slide 38: Outright hedging (Central Europe & Nordic)
Outright hedging (Central Europe & Nordic) €/MWh ~49 2015 ~38 ~38 2016 ~32 ~33 2017 ~30 0% 20% 40% 60% 80% 100% Central Europe Nordic 37
Slide 39: Continuation of scrip dividend scheme
Continuation of scrip dividend scheme Voluntary Additional option for shareholders to exchange the cash dividend into E.ON shares scrip Cash payment is default dividend Subscription price will be close to market price (considering a discount of up to 3%1) Use of E.ON will make use of its exi
Slide 40: E.ON Investor Relations Contact
E.ON Investor Relations Contact Anke Groth Head of IR T+49 (211) 45 79 345 anke.groth@eon.com François Poullet France & Benelux T +49 (211) 45 79 332 UK francois.poullet@eon.com Marc Koebernick Germany & Switzerland T +49 (211) 45 79 239 US marc.koebernick@eon.com Dr. Stephan Schönefuß UK T +49 (211
Slide 41: Reporting calendar & important links
Reporting calendar & important links Reporting calendar May 7, 2015 Interim Report I: January – March 2015 May 7, 2015 2015 Annual Shareholders Meeting August 12, 2015 Interim Report II: January – June 2015 November 11, 2015 Interim Report III: January – September 2015 March 9, 2016 Annual Report 20
Slide 42: Disclaimer
Disclaimer This presentation may contain forward-looking statements based on current assumptions and forecasts made by E.ON Group Management and other information currently available to E.ON. Various known and unknown risks, uncertainties and other factors could lead to material differences between